Daily Digest

Daily Digest 1/29 - Disney Insider Trading, Market Falls as Egypt Unrest Continues, Banks Bundled 'Deficient' Loans

Saturday, January 29, 2011, 11:00 AM
  • The Big Squeeze, Part 2: Abused Fundamentals and Fake Markets: How They Play Out
  • Thank GDP It’s Friday!
  • Welcome, ‘Peak Oil’
  • Disney Inside Trading Schemer Gets Prison
  • U.S. Stock Market Falls As Egypt Unrest Continues
  • Banks Accepted And Bundled ‘Deficient’ Loans
  • Secret to Bank's Comeback: A Rich Uncle Named Sam

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The Big Squeeze, Part 2: Abused Fundamentals and Fake Markets: How They Play Out (charles)

Analyses that try to predict near term market moves based on Laffer curves, Elliot Waves, and historical cycles will almost definitely fail. We don’t have a “new era”, but we definitely have unprecedented coordinated global intervention dedicated almost solely to the fortunes of the top 1%. That is the new rule that will govern until there is a serious breakdown. Warren Buffet got this insight after the financial crash in 2008. He knew the government was going to step in to save and subsidize the big banks so he swooped up their stocks, garnering himself a hefty tax break in the process.

Thank GDP It’s Friday! (ilene)

As I said on Mondaywhen looking ahead to whether we'd have our Alpha 2 drop pattern we had last year: "Surely the Fed can break this patten as we have as much as $9Bn worth of POMO today, $8Bn tomorrow, $6Bn on Thursday and $9Bn on Friday (see SWW for chart) for a whopping $32Bn of fresh money created by the Fed in just 5 days. As I said to Members this morning – that is like handing everyone in America $100 to spend – you would think that would boost the markets just a little, right?"  So you can see why I'm still a little cynical - we've seen this movie before and we know how it's going to end, it's just a question of when.

Welcome, ‘Peak Oil’ (woodman)

It is notable that in 2009, the IEA stressed the importance of oil for economic growth and concluded that 106 million barrels per day will be required by 2030; representing an increase of approximately 18 million barrels per day above current output.  Interestingly, in last year’s report, the IEA predicted that global production will peak at only 96 million barrels per day in 2035! So, within the course of a single year, the energy watchdog for the developed world lowered its production estimate by 10 million barrels per day! 

Disney Inside Trading Schemer Gets Prison

The plot was hatched last year while Sebbag's girlfriend, Bonnie Hoxie, 34, was the secretary to Disney's head of corporate communications in Los Angeles. Prosecutors say she fed nonpublic information such as the company's quarterly earnings to Sebbag, who tried to sell the inside tips by sending anonymous letters to 33 hedge funds and other investment companies. Most of the firms that received the offers, including some in Manhattan, notified the FBI. Federal agents then posed as hedge fund traders and offered to buy the information from the couple.

U.S. Stock Market Falls As Egypt Unrest Continues

Scenes of demonstrators challenging the government of Egypt, a strategic ally of the United States in the volatile Middle East, helped send oil prices 4.3 percent higher. In a flight to safety, investors increased their purchases of U.S. Treasurys, pushing the yield on 10-year bonds down to 3.33 percent from 3.38 percent a day earlier. The price of bonds rises as the yield falls.

Banks Accepted And Bundled ‘Deficient’ Loans

The panel’s study found that Clayton rejected 28% of the loans in the sample as “deficient” for failing to meet originator underwriting standards, yet nine big banks accepted, on average, 11% of those loans anyway. In many cases, such loans failed to meet both originator underwriting standards and guidelines provided by the financial institution purchasing the loan, the panel said.

Secret to Bank's Comeback: A Rich Uncle Named Sam

As the nation's roughly 7,700 banks and savings institutions try to recover from about $493 billion in loan losses since the start of 2007, BankUnited is emerging as a case study of how government largess in the immediate wake of the crisis has allowed certain lucky institutions to thrive—while others, whose timing was less opportune, continue to struggle. As the economy stabilized, the FDIC's incentives to lure buyers became less generous than those enjoyed by the new owners of BankUnited.

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idoctor's picture
Status: Diamond Member (Offline)
Joined: Oct 4 2008
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Re: Daily Digest 1/29 - Disney Insider Trading, Market ...

Really sad...

Goldman Sachs Gives Blankfein a Big Raise http://www.cnbc.com/id/41326458

Lloyd C. Blankfein, the chief executive of Goldman Sachs, had a rough 2010. But at least he got a raise: his bonus increased by $3.6 million, according to a regulatory filing.

The India Today Group | Getty Images
Lloyd Blankfein

The firm’s board granted restricted stock valued at $12.6 million to Mr. Blankfein and other senior executives, including Gary D. Cohn, the firm’s president. The board also approved a new annual base salary of $2 million for its chief executive, up from $600,000. Mr. Cohn and others will see their base salaries increase to $1.85 million, according to the filing on Friday.

With his previous salary of $600,000, Mr. Blankfein’s 2010 compensation comes to $13.2 million. Senior executives often receive part of their compensation in cash, but Goldman did not release details on this component of Mr. Blankfein’s compensation.

In 2009, amid a widespread public outcry over sky-high pay on Wall Street, Mr. Blankfein and other senior Goldman executives received compensation packages valued at $9 million each. In 2007, the year before the financial crisis, Mr. Blankfein made $68.5 million.

The firm paid $550 million to settle the charges. It did not admit or deny wrongdoing.

Mr. Blankfein isn’t the only Wall Street chief to get a raise for his work in 2010. JPMorgan Chase has not yet announced the pay of its chief executive, but Jamie Dimon is expected to earn as much, if not more, than the $17.5 million he took home in 2009.

This month, Morgan Stanley’s board awarded its chief executive, James Gorman, stock and options valued at $7.4 million. But this represented only the equity portion of Mr. Gorman’s pay package; the cash component will be announced later this year. Mr. Gorman, in his first year as chief executive of Morgan Stanley, will earn less than the $15 million he took home in 2009, when he was the firm’s co-president, according to a person familiar with his compensation but not authorized to speak publicly about it.

Citigroup’s chief executive, Vikram S. Pandit, after nearly two years of earning $1 a year while he tried put the bank back on track, was recently awarded a $1.75 million salary.

At Goldman, David A. Viniar, the firm’s chief financial officer, and the vice chairmen J. Michael Evans and John S. Weinberg also received stock valued at $12.6 million, regulatory filings show. Their base salaries also rose to $1.85 million.

This story originally appeared in the The New York Times
idoctor's picture
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Re: Daily Digest 1/29 - Disney Insider Trading, Market ...

idoctor's picture
Status: Diamond Member (Offline)
Joined: Oct 4 2008
Posts: 1731

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